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Namibia Mining Report Q2 2016

Namibia Mining Report Q2 2016

BMI View: Namibia will remain one of the smaller players in the wider Sub-Saharan Africa mining sector,though we believe the market is well positioned for growth over the next few years. The main driver ofgrowth will be the country's emerging uranium mining industry which is benefiting from high levels ofoverseas investments and development. However, we believe softness in global commodity markets willtemper growth in the short term, with further contraction in the country's diamond production expected in2016 as prices remain under pressure globally.

Latest Forecasts And Developments

We have lowered our projections for Namibia's diamond output downwards falling February 2016'sannouncement by industry leader Namdeb that the company's production volumes had fallen to 400,000carats in Q415, representing a y-o-y drop of 18%. The miner attributed the contraction to continuedsoftness in global diamond prices and the decision to focus mining activity on lower grade deposits overthe quarter.

We now forecast Namibia's total diamond production to contract by 1.7% y-o-y in 2016 to 1.57mntonnes; we anticipate a return to positive growth in 2017, with total output reaching 1.72mn carats by2020.Our outlook for the uranium mining sub-sector remains positive.

Canada's Bannerman Resources has reported further positive results from Phase 2 of the Etango HeapLeach Demonstration Plant Program mine. A recent optimisation of Etango resulted in an improvementof the project's net present value to USD419mn from USD69mn, with production averaging 7.2mnpounds of Triuranium octoxide annually over an initial open pit mine life of 15.7 years.

BMI forecasts Namibia's uranium production to grow by 4.0% in 2016 to 3.5kt. Mining activity willaccelerate from 2017 as a number of foreign-led developments come online. We project output toincrease by 10% y-o-y over 2017-2020 to reach 5.1kt by the end of the forecast period.


BMI Industry View
Table: Namibia - Mining Industry Value
Latest Forecasts And Developments
SWOT
Industry Forecast
Uranium: FDI To Support Long-Term Growth
Latest Developments
Table: Uranium Production (Namibia 2012-2020)
Structural Trends
Table: Namibia - Uranium Exploration Projects
Diamonds: Offshore Development Key To Expansion
Latest Developments
Table: Diamond Production (Namibia 2013-2020)
Table: Namibia - Diamond Exploration Projects
Industry Risk/Reward Index
Namibia Risk/Reward Index
Rewards
Risks
Africa: Major Risks Remain
Key Takeaways
Latest Revisions
Table: Africa - Mining Risk/Reward Index
Regulatory Development
Commodities Forecast
Commodities Outlook
Table: BMI Commodities Price Forecasts
Competitive Landscape
Table: Africa - Largest Listed Mining Companies
Company Profile
Namdeb
Global Company Strategy - Vedanta Resources - Q1 2016
Latest Financial Results
Company Strategy
Table: Vedanta Resources - Supply Chain Analysis
Company Details
Table: Vedanta Resources - Key Financial Data
Regional Overview
Table: SSA - Government Involvement In Mining Sector
Methodology
Industry Forecast Methodology
Sources
Risk/Reward Index Methodology
Table: Weighting Of Indicators

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